Active property transaction year despite the pandemic
The transaction volume of the property market was EUR 5.7 billion in 2020. The transaction volume decreased slightly from 2019, which can be at least partially explained by corona crisis and resulting travel and other restrictions, that hampered transactions. Despite the exceptional conditions, foreign investors interest towards Finnish property market remained strong. In 2020, Finland gained property investments worth EUR 3.0 billion by foreign investors, which was circa 53% of all investments.
Office and logistics prime yields for the HMA decrease again
The prime yields for offices and logistics properties decreased during the autumn of 2020 after the shock and the consequential yield increase experienced in the spring. The office prime yield in the Helsinki CBD decreased in the autumn by 0.1 percentage points and is now at 3.4%, which is close to the level preceding the coronavirus crisis. In growth centres, the prime yields for both office and logistics properties mostly remained the same during 2020. The prime yields for retail premises, however, increased both in the HMA and in nearly all growth centres because of uncertainty affecting the retail space market.
No significant changes in office vacancy rates yet
Despite the corona recession, no significant changes in office vacancy rate have been detected. The office vacancy rate in the HMA was 12.2% at the turn of the year. Yet we doubt that the commercial property market is to survive this economic crisis without implications. It is possible that the vacancy rates increase and more challenges appear on the office and retail market during this spring.
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